Mumbai: Domestic mid-market private equity (PE) fund CX Partners has wound up its mezzanine debt fund called CX Intermediate Capital Fund.

The fund has sold its investments and returned money to investors, said Shishir Jain, who has resigned as managing director of the fund. Jain, however, declined to disclose details of total capital returned or the number of investments made by the fund.

“It was a relatively small fund and I am not in a position to share any further details about it," Jain said in a phone interview.

The fund, a hybrid of debt and equity, mainly invested in companies which are not fully backed by PE firms or those looking for last-mile funding to complete projects. CX had hired Jain in 2011 from JPMorgan Chase, where he was an executive director and head, India (principal investment management).

Jayanta Basu, managing partner of CX Partners, said, “CX has exited CX Intermediate Capital as the partnership strongly feels that we would like to concentrate on the private equity space and not any other asset class".

According to two people familiar with the development, CX Partners had raised around $70 million in early 2014 for its structured credit fund and begun investing from the fund even as it continued to raise another $200 million in committed capital from overseas investors.

Recently, it participated in a Rs400 crore (nearly $60 million) funding round in Hyderabad-based NSPIRA Management Services Pvt. Ltd with Olympus Capital Asia Credit.

According to news portal VCCircle, CX Partners had, through its mezzanine funding arm, invested in Agarwal Packers and Movers Ltd in November 2015 in a deal that helped the Delhi-based logistics company buy out Kotak Private Equity from a group firm.

While Basu declined to comment on the reasons behind the decision to wind up the business, the people cited above said that it was primarily due to a lack of investor interest.

The exit of CX Partners from structured credit business comes at a time when a number of PE entrants are looking to tap opportunities.

Mint reported on 6 February that Baring Private Equity Asia, one of the largest Asia-focused PE funds, is raising a new India-dedicated credit fund of Rs500 crore with a greenshoe option of Rs250 crore.

CX Partners, founded in 2009, manages a fund with a corpus of $500 million and has invested in companies including Barbeque Nation Hospitality Ltd, Sapphire Foods India Pvt. Ltd, Ujjivan Financial Services Pvt. Ltd, South Indian Bank, Karur Vysya Bank, Thyrocare Technologies Ltd and Minacs.

In December 2015, Ajay Relan, co-founder CX Partners, stepped down as managing partner and co-founder. Jayanta Basu was appointed managing partner with responsibility for its day-to-day operations.

Mint had earlier reported that CX Partners is in the process of raising its second PE fund of $500 million.

Apart from investing capital, the PE fund has started seeking exits.

According to the people cited above, it is currently in talks to exit its investment in surgical equipment maker Sutures India Pvt Ltd.

One of its portfolio companies, Security and Intelligence Services (India) Ltd (SIS), received regulatory approval for an initial public offering (IPO) in January this year.

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